Bloodbath at Pakistan Stock Exchange as index lost nearly 1447 points
Political and economic uncertainty main cause of today's mayhem at PSX
The Pakistan
Stock Exchange (PSX) witnessed bloodbath today as 100 index lost 1447 points in
a single day. PSX at one point during the trading session lost more than 1,543 points
or 3.44% value. But it recovered a bit before the closing. The 100 index closed
at 43,393.14, down 1,447.67 points, or 3.23%. The investors lost billions of
rupees within couple of sessions.
The four
main reasons contributed in today’s mayhem at share market. The political and
economic uncertainty in the country is the main reason. The new government led
by PM Shahbaz Sharif hasn’t come up with the concrete plan to address the main
economic issues.
The
political tension is raising b every passing day and PTI chairman Imran Khan is
threatening to launch long march towards Islamabad.
The other
reason is continues loss of the value of Pak Rupee against US dollar. The Rupee
recovers some of the value when new government took over a month ago but it
lost its value again in the last few days.
The uncertainty
regarding the IMF programme is another reason of this shaky confidence of
investors. The negotiations with IMF will start on May 18 in Doha to resume the
IMF programme. Pakistan is also asking for additional $2 billion from IMF.
There were
hopes of a Saudi economic package during the PM Shahbaz Sharif’s visit to
Kingdom. But no formal announcement has been made so far regarding the economic
package.
It seems
that situation is going to be volatile unless government secures a new bailout
from IMF. The government needs to take immediate actions to stablise the
situation in the country.
In order to
control the situation the government needs to lay out a concrete economic plan,
moreover, a strategy needs to be devised regarding oil prices and controlling
rising commodity prices.
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